April 28th, 2009 at 12:00pm
The UAW ends up with a majority stake in Chrysler. GM bondholders are unhappy with the company’s payment proposal. The automotive task force blocked GM from giving money to Delphi and taking over its steering business. All that and more, plus John chats with Jeff Gilbert of WWJ Newsradio 950 about what’s going on at GM.
Transcript and Story Links after the jump . . .
Here are today’s top headlines. The UAW to take a majority control of Chrysler. GM bondholders accuse GM of bad faith. And Delphi’s days look numbered.
Up next, we’ll be back with the news behind the headlines.
This is Autoline Daily for Tuesday, April 28, 2009. And now, the news.
Well, we woke up this morning to find out that the UAW is now the owner of Chrysler. You heard right, the union will end up with 55% of Chrysler’s stock, the AP reports. Fiat will end up with 35%. The remaining 10% goes to the government and secured lenders. The UAW is getting stock to pay for half the cash it’s owed for its retiree health care program. The union made more concessions including work rules, COLA, dental and vision care. Daimler also announced that it is giving up its 19.9% ownership in Chrysler, and forgiving all loans that Chrysler owes it. Hey, maybe Chrysler will avoid filing for bankruptcy.
But probably not GM. Autoline Daily was contacted yesterday via email by an ad hoc group representing GM’s bondholders. They are not happy. They say the UAW will get 50% cash for what it’s owed and will end up with 39% of GM’s stock, while bondholders will only get 10% stock and no cash. They say this amounts to using taxpayer money to play political favoritism of unions over bondholders. And it sure sounds like this will only get resolved in bankruptcy court.
And Delphi’s outlook looks grimmer. The automotive task force blocked GM from giving another $150 million to Delphi and taking over its steering business. According to the Detroit News, they have until May 9 to resolve Delphi’s bankruptcy. If that doesn’t happen, Delphi could be forced into liquidation.
With Pontiac’s days numbered, GM may need to rebadge at least one car line. Autoblog reports that the Pontiac Vibe, built in the NUMMI joint venture plant that GM has with Toyota, could become a Chevrolet. Along the same line Nissan may be changing its mind. The next-generation Titan was supposed to be built off the Dodge Ram, but with all the trouble Chrysler’s in right now that deal is on hold (subscription required). The company could update the current Titan.
Navistar became the first truck and bus maker to receive hybrid certification from the California Air Resources Board. Navistar’s International DuraStar hybrid box van and utility truck, and IC Bus CE Series received the certification. Under the program, buyers will receive $10,000 to $35,000 to purchase a vehicle, depending on the weight class. Navistar’s certification adds another $5,000 to this program.
Pedestrian safety seems to be all the rage these days. From making hybrid vehicles noisier, to the new crash standards, everyone seems to be pushing for better safety. Every driver’s worst nightmare is having someone dart out in front of them from between two parked cars. So BMW and some German Universities are developing a system called AMULETT, which is short for a really long German name. Basically it works by having people carry a small radio transponder that communicates with vehicles and can warn drivers when pedestrians are near. The device could be integrated into back packs, cell phones or even walking sticks.
Coming up next, I chat with Jeff Gilbert of WWJ Newsradio 950 about what’s going on at GM, we’ll be back right after this.
There’s been a lot of news coming out of GM the last few days – more cuts, layoffs and the dropping of Pontiac. Jeff Gilbert from WWJ Newsradio 950 joined me via Skype for a chat about what’s going on at the company and where things might be headed.
By the way, there’s more to this interview than what we had time to post here. You can watch the rest of our chat on the John’s Journal page of our website, AutolineDaily.com. We dig deeper into the recent GM news. Twitter was ablaze with people tweeting and asking about the company killing-off Pontiac. Jeff and I talk at length about that, so check it out.
Hey, join us again this Thursday night for another installment of Autoline After Hours. It kicks-off at 7 p.m. eastern time, or 2300 hours GMT for all you international viewers. Of course Pete and Jason are going to be there, but Robert Farago, publisher of The Truth About Cars.com will also be joining the fray via Skype. You’re not going to want to miss this one. We’ll also be focusing more on viewer comments so jump in the chat and let your voice be heard!
Anyway, that’s it for today’s top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.